Uniswap V3 Book
Mastering Uniswap V3
Uniswap V3 innovated the concept of concentrated liquidity. Concentrated liquidity allows traders to get better trade executions and enables liquidity providers to earn higher fees relative to a traditional xy = k AMM. As such, Uniswap V3 turned concentrated liquidity into a very popular DeFi primitive.
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Uniswap V3 is notoriously one of the most complicated codebases in DeFi. However, developers and auditors should learn it as Uniswap V3 has spawned over 150 forks collectively holding over 2.5 billion dollars of value at the time of writing (source).
This book aims to be the most meticulous and thorough treatment of the subject, while also being highly accessible. Uniswap V3 has some extremely intimidating mathematical libraries that, until now, have no tutorials that explain how they work. We do not avoid the hard topics in Uniswap V3, but rather invest heavy effort in making them accessible.
However, this book is not a dense math treatment, but a gentle journey through a new domain that carefully introduces concepts only as they are needed while relating those concepts to what was covered before.
This book is also the first to include interactive animations and tools to speed up the learning process for the reader.
Our goal is to explain things as simply as possible, without oversimplifying. We assume the reader is familiar with Uniswap V2 already.
1.
How Concentrated Liquidity in Uniswap V3 Works
2.
Introducing ticks in Uniswap V3
3.
Q Number Format
4.
Square Root Price in Uniswap V3
5.
Tick limits in Uniswap V3
6.
Uniswap V3 Factory and the Relationship Between Tick Spacing and Fees
7.
Computing the Current Tick Given sqrtPriceX96
8.
Square and Multiply Algorithm
9.
Tickmath getSqrtRatioAtTick
10.
Real and virtual reserves in Uniswap v3
11.
Real reserves in Uniswap v3
12.
The constant product formula in Uniswap v3
13.
Calculating the real reserves between two prices in the Uniswap V3 codebase
14.